Noncustodial parents with a child support obligation who are thinking about filing for Bankruptcy must understand the relationship between Bankruptcy and Child Support. Parents ordered to pay child support have a legal responsibility to consistently take care of their children financially, even if they are struggling with debt. Each Chapter of Bankruptcy has different requirements for Debtors who owe Child Support.
Child Support Obligor (Owes Support) & Chapter 13 Bankruptcy
Noncustodial parents who owe Child Support and file for Chapter 13 Bankruptcy still need to fulfill their responsibilities under the support order. The monthly obligation must remain current throughout the life of the case otherwise the Debtor will face dismissal of the case and or denial of discharge. If the support order is in arrears at the time a Chapter 13 is filed, those arrears would be repaid through the Chapter 13 Plan. Upon completion of the 3-5 year plan the child support would be current due to repayment of the arrears through the plan and the required maintenance of the monthly payments over the life of the plan.
Child Support Obligee (Owed Support) & Chapter 13 Bankruptcy
If a child’s parent filed for Bankruptcy and you are owed child support your rights to receive this support are unaffected by the bankruptcy. The obligor will be required to repay any arrears through the Bankruptcy plan and is required to continue to keep up the monthly obligation owed under the support order. The Obligee will receive a letter from the case Trustee outlining their rights as it relates to child support and bankruptcy.
Noncustodial Parents & Chapter 7 Bankruptcy
Noncustodial parents who owe Child Support and file for Chapter 7 Bankruptcy will still be required to fulfill their responsibilities under the support order. Any child support arrears are a non-dischargeable debt, meaning that the obligation will survive the Bankruptcy filing. The obligor will be required to provide the case Trustee with the name and address of the obligee.
What you need to know about Bankruptcy and child support
- The automatic stay will not stop child support from accumulating.
- The automatic stay does not delay child support proceedings.
- The Bankruptcy trustee has child support reporting requirements.
- Child Support Arrears are paid a fixed monthly payment repaid over the life of a Chapter 13 Plan.
- In Chapter 7, you will remain responsible for child support and child support arrears after the case closes.
- In Chapter 13, child support arrearages are repaid in a span of three to five years.
Filing for Bankruptcy prevents creditors from collecting dischargeable debts from you including continuation of lawsuits. This, however, does not apply to most child support proceedings, including:
- Proceedings to establish or modify a child support order.
- Collection of child support from property that is not part of the bankruptcy estate.
- Income withholdings to pay child support under an administrative or court order.